Tuesday 1 May 2012

Sharpe Minds Edges

My lazy Risky Business? post, courtesy of the Mail Online, attracted some attention, with a few comments from some familiar names. I wasn’t sure about including it, but since the intelligent readers this blog is targeted at know better than to use the Mail as their ‘news’ source, I felt it may well have escaped the notice of a few people who would be interested in some of the content.

BigAl even managed to make me smile with his comment that, for a while, it looked as if a piece about William Hill might finish without a reference to Graham Sharpe, but true to form, there was his name. Ladbrokes used to have a similar PR representative, Ron Pollard, but he is now retired and living in Pinner last I heard. Not somewhere I will be looking at to live out my old age incidentally.

Webbo’s observation was that the article ‘shows just what the average Joe is up against’, to which Mark Iverson responded that the article can be viewed in two ways – the way Webbo stated, or alternatively “look at the number of opportunities!” 

Mark's closing comment was that “I guess it’s down to whether you’re a glass half full or glass half empty type of person”.

Well, not exactly. While it is all very well to be optimistic when it comes to non-exchange gambling, it’s probably more important to be realistic, and the logical conclusion is that with all the resources at the bookmaker’s disposal, any success by an individual is likely to be very short-lived, as the article mentions.

The bookmakers make the rules, and if doesn't suit them to let you play, or they only want you to play for peanuts, then they have that right and they are not shy about limiting you.

As BigAl noted, it “takes a fair amount of effort to take advantage of the opportunities… in terms of constantly having to open new accounts”. Indeed it does. Bookmakers know who the ‘sharps’ are, and they know their street and IP addresses. New accounts using the same IP address are not going to last for long. In my opinion, unless the rewards have a good chance of being available at least for a while, it’s simply not worth the effort needed to open these accounts.

One of the beauties of the exchange concept for me, was that winning accounts do not get closed down. They may do in the future, but for now they don’t, and while the commission charged to winning accounts may seem excessive, when you consider the alternative of not being allowed to play, well, at least the choice as to whether or not to continue is yours. 

When Ladbrokes and Coral closed my accounts down in the 80s, I had no alternative other than to quit. I could have opened new accounts in other names, (and that was a lot easier back then), but it’s a road to nowhere. Sooner or later you run out of relatives and I don’t have many friends for some reason.

The suggestion from Mark that "by covering so many markets the bookies open up many more doors for punters to gain an edge" is definitely optimistic but the reality is that the door of opportunity will remain open only if it is profitable for the bookmaker. New 'opportunities' are not offered on a whim, but after much research and are managed closely. If a few individuals 'gain an edge', the bookies will make adjustments, restrict the entry of regular winners into that market, and if they are losing to many, the door will be closed altogether - or the over-round inflated to the point where no one can win. 

Las Vegas casinos don't add Blackjack tables to provide more opportunities to gamblers. They are there to generate another income stream, and as with successful sports bettors, successful Blackjack players will find it hard to play. I'm not saying that short-term, the bookies can't be beaten, just that bookies are bad losers, and winning money from them long-term is not realistic.

An edge with no place to use it is pretty much worthless. The ability to ‘get on’ is an essential piece of the puzzle. You might be the world's number one expert on synchronised swimming, but try making much money from it. 

Bookies do make mistakes, the hole-in-one golf story is one great example, and I believe some have already paid out on Manchester United to win the league this season, but they do not keep losing money to the same individuals.

Opportunities? Yes, at first sight, but are they viable long-term opportunities for decent profits? No. It has nothing to do with one's level of optimism, which by nature I would expect to be on the high side for most readers, more to do with realism and understanding that bookmakers are there to make a profit, not to provide you with a source of income week after week. It won't happen.

On a slightly different topic, Webbo wrote:

"Thanks for your insight into your staking too. It's interesting that you say punting profits are more value when you factor in the hourly rate as it's for this reason I'm trying to turn my attentions more to these. It's obviously much harder but if I'm honest I am starting to resent the amount of my free time I spend betting in-play and I do fear each time another blog opens of a young person who aims to make a living from in-play trading. Their lives will consist of staring at a screen 24-7 and if I had to price it up, I'd say it's 1.01 that they don't make anything close to a living out of it."
I have to agree with Webbo's further thoughts. In-play trading does take a toll on your personal life, and at any other time in my life, I wouldn't have been able or willing to put the necessary hours in to be profitable. Trading is perfect for boring old bastards like myself. In fact, while I don't know too many Super Premium Charge payers, the ones I do know of are all 'men of a certain age', with baldness an apparent pre-requisite for success!


AL said...

Liverpool, the team that keeps on giving.

How long will my edge last??


Harry Haller said...

Coming from an arbitrage background, I can say you are soooo right on this.. While arbitraging I kept a consistent edge over the bookies (a measurable, purely mathematical edge if there was ever one..). It lasted for a while, and it was great, but suddenly all of them starting to limit me so badly that I simply had to stop doing it for a profit...
Quite simply put, as you said, it's their game, they make the rules and decide who they want in... I only hope betfair does not decide to go down this route as well!